In a year-end interview with CBC’s Rosemary Barton last month, the prime minister reaffirmed his view that a “long-term conversation about increasing health care funding” should take place.” when the pandemic is over.”
A few weeks later, with the rapid spread of the Omicron variant, it’s even harder to know when this conversation should start.
But an unofficial debate about health care in Canada is already taking shape – between demands for increased public funding on the one hand and calls for a “greater role for private health care delivery” on the part of the government. ‘other.
With the highly contagious variant of Omicron and a large population of unvaccinated Canadians threatening to flood hospitals, healthcare capacity is the concern of the moment.
Canada is not unique in this regard. Thousands of surgeries have been canceled in the UK since the start of the pandemic. But the strain on the Canadian system was also predictable. In fact, Frances Woolley, an economist at Carleton University, predicted that COVID-19 would reveal the fragility of the system in March 2020.
As Woolley wrote, Canada has the second-lowest number of acute care beds per capita among Organization for Economic Co-operation and Development (OECD) countries, and nearly all of those beds tend to be occupied.
While the total number of acute care beds has largely declined in advanced economies over the past 50 years due to changes in technology and care, the particularly low number in Canada can be attributed to “a failure of funding levels to keep pace with population growth,” explained Woolley.
Danyaal Raza, a family physician in Toronto and former president of Canadian Doctors for Medicare, presented a similar case last fall. He said that when it comes to health care costs, Canadian governments pick up a smaller share of the bill than the governments of many of our peers.
The case for spending more
This is partly because Canada’s universal system does not include things like pharmacare and mental health. Raza argued that this was also due to a lack of public investment.
While Trudeau has refused to meet provincial demands for a substantial increase in the Canada Health Transfer (CHT) – the main mechanism by which the federal government funds health services at the provincial level – the Liberals have offered to address the specific services.
Building on previous agreements to fund mental health services, the Liberals promised last fall to create a dedicated Canada mental health transfer with an “initial investment” of $4.5 billion over five years. The Liberal platform also promised $9 billion to improve long-term care and $3.2 billion to help provinces and territories hire new doctors and nurses.
Somewhere in the background is an outstanding federal commitment to expanding pharmacare. Ottawa signed its first (and so far only) agreement to improve drug coverage with Prince Edward Island last August.
But the provinces demanded much more than that – an immediate increase of up to $28 billion in the TCS, the hospital and physician fund that gives provincial governments money they can spend as they see fit.
In that year-end interview, Trudeau said the support the federal government has provided to the provinces during the pandemic — which includes a $4 billion “top-up” to the TCS this year — has proven that “yes, the federal government is absolutely willing to step up health care. How much and what it looks like and what is needed, well, those are really important conversations to have.
These conversations will pose big questions that need answers.
In the last election, Conservative Leader Erin O’Toole proposed increasing the CHT at an annual rate of 6% for at least the next ten years. He did not consider what this would mean for the federal budget in the long term. The Institute of Fiscal Studies and Democracy warned that such an increase could “require significant cuts in other spending measures or increases in revenue measures to maintain fiscal sustainability.”
At the start of the pandemic, Woolley argued that the federal government was best placed to shoulder the burden of increased investment. She also suggested that the GST could be increased by two points to pay it.
This option may seem politically untenable. But while Raza said Canada needed to be “smarter” about its health spending, he also argued that the public system faced not a cost problem but a revenue problem, due to the lower taxes on corporations and the wealthiest Canadians.
The public-private debate intensifies again
Greg Marchildon, executive director of the latest royal commission on health care in Canada, suggests that rather than increasing the CHT, the federal government should focus on pharmacare and long-term care, which would help to cover the high costs currently borne by the provinces.
But Sean Speer, Stephen Harper’s former senior policy adviser, wrote this week that 2022 should be the year Canadians must confront shortcomings in the health care system and consider a bigger role for private delivery.
Such a speech could revive a debate that played out awkwardly during the last election.
Although almost completely lost in the storm around the editing of a video posted by Chrystia Freeland, there was a real sticking point between liberals and conservatives over private health care.
Arguing that access to care should not depend on ability to pay, the Liberal government has threatened to withhold funding from Saskatchewan’s TCS in response to a program in the province that allows residents to pay for MRI scans in for-profit clinics, as long as those clinics offer an equal number of exams to people on the provincial waiting list. The Liberals made similar threats in 2016 in response to user fees imposed by the Quebec government.
But O’Toole said he would support “innovations” like Saskatchewan’s program that give Canadians “more choice” — a notion that, while debatable, might appeal to Canadians frustrated with the public system.
“I think the thing that creates these discussions [about privatization] it’s when we underinvest in those universal public systems that we know are the fairest way to deliver care,” Raza said in an interview this week.
Most premiers might not want to transfer a lot more money to the provinces without some assurance that the money will be well spent.
But if the Liberal government wants to stifle those seeking private “innovation,” it may need to up the ante. And then, if necessary, argue that the cost is worth it.